The challenge of ethical engagement

Andrew Leigh talks to Stephen Howard, Chief Executive of Business in the Community

Andrew: From your perspective, is ethical engagement an issue for Business in the Community?

Stephen Howard: Yes, we would say that ethical engagement is part of responsible business an important issue for Business in the Community. Increasingly employees want to feel they work for a responsible organisation. They look to see an ethical stance from their company in a number of ways, and it isn’t that stuff on wall, but how business is actually conducted, how assessment plans work, the type of workplace they have and what opportunities they’re given to engage in the communities they live and work in.

The other side of the equation is when they’re doing their job, how they’re encouraged to adhere to the ethical standards of the business. The real message is what are the real incentives and metrics that are used to drive business behaviour?

I see it in two different ways: whether people feel there is an ethical response / (incentive), and secondly, how they participate – are they given the opportunity, rewarded and encouraged to be ethical in every part of the business?

Andrew: So how important is it to have ethically engaged employees in your view?

Stephen: Every business leader I talk to says they want to do the right thing but they don’t always know how to make it happen.

Business leaders need better, helpful, practical tools they can use. For me it’s how to simplify the journey. What are the practical steps that you could take to drive that through?

I mean how realistic is it in a place of a hundred thousand people – is it achievable? For example, how do you go about creating compensation programmes, reward structures and advancement processes that achieve all that? As the economy improves and therefore people have more freedom to move around it creates a bigger issue for companies to solve.

So the dialogue we’re increasingly having with companies is around what is ethical leadership, and everything’s kind of grey, you know?

Andrew: So what kind of response do you get from these leaders?

Stephen: When I talk to Chief Executives about their collective commitment to sustainability, depending on what words you use I can see their eyes glaze over. But the commitment is there, so I talk about their legacy.

You know, every manager is fighting fires, facing short-term pressures and some of these key changes in organisations are really hard to achieve. It’s not always crystal clear what is ethical behaviour. For example is pay day lending ethical?

The other frustration I hear from leaders about all this ethical stuff is: “Yeah it looks great, but you know, my shareholders don’t ask me about it and my customers don’t want to pay for it.” They want it yes, but is it an excuse or a frustration?

Andrew: Well, what guidance would you give leaders who want to achieve ethical engagement through community involvement?

Stephen: For us it’s about creating quality within your workforce. We ask: what are the things you are going to create to produce the sort of environment you say you want? You have to make this part of your core strategy, creating business value in your business by living your values.

It’s therefore example in the moral compass of the company, the ethical standards. We do all kinds of interesting programmes but the core is, if the engine of your business is unethical then none of the rest of the stuff does much to win ethical engagement.

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